Report of the Deputy Chief Executive and City Treasurer attached

The report of the Deputy Chief Executive and City Treasurer and City Solicitor explained how the budget proposals for the Directorate had been developed.

Following the provisional finance settlement announced 18 December the Council was forecasting an estimated budget shortfall of £38m in 2024/25, £79m in 2025/26, and £90m by 2026/27. After the application of approved and planned savings, and the use of c.£17m smoothing reserves in each of the three years, the budget was balanced for 2024/25 and the remaining gap reduced to £29m in 2025/26 and £41m by 2026/27. This position assumed that savings of £21.4m will be delivered next year.

The Corporate Core had delivered savings of £3.365m in 2023/24 and currently had approved savings of a further £2.734m over the next three financial years with £0.677m scheduled in 2024/25.  The already approved £0.677m savings for 2024/25 were split between Future Programme savings £472k and general housekeeping savings of £205k.

In addition to the already approved savings and in recognition of the work required to balance the overall council budget, further options for savings have been developed, and the areas considered included the following:-

·            Review of workforce structures and capacity alongside taking a realistic view on the ability to fill longstanding vacancies.

·            Review all income generation from sales, fees and charges and whether there are opportunities to increase charges in line with inflation and increase income.

·            Review all savings proposals that have not been taken forward as part of the 2023/24 budget process. 

The measures proposed included:-

·            Additional income of £130k:

·                £50k from increased vehicle clamping income.

·                £80k from increased registrars income following the price increase that was introduced during 2023/24 which aligned Manchester registrars fee levels with that of other Core Cities.

It was reported that the Council’s staffing establishment was budgeted at the top of the grade, with an allowance made to allow for vacancies, staff not being at top of grade and in year turnover. Despite this, staffing budgets had continued to consistently underspend across all directorates.  All vacant posts had been reviewed, with a focus on those that have been vacant for longer than 12 months, to determine which posts should be deleted with the least impact on service delivery.  

As part of the Council wide £1m saving from vacant posts the Corporate Core had identified total savings of £286k through deletion of eight long term vacant posts

In terms of budget growth and as part of the 2023/24 budget approvals £0.783m was approved for 2024/25 and this was in respect of:-

·            A regular refresh programme of ICT equipment would be undertaken, and an annual budget of £0.75m was approved from 2024 as part of the 2023/24 budget to support the ongoing costs of the refresh programme.

·            £33k growth was also agreed to offset pressures in HROD (£23k due to reduced school income for payroll services, and £10k in financial management to cover increased costs of Civica Pay licences).

In addition to the above growth approved as part of 2023/24 budget process further budget proposals of £8.123m were proposed, with £4.123m being required in 2024/25 to address ICT investment and External Audit increased fees

As part of the annual budget process all sales, fees and charges had been reviewed to ensure that the services were fully recovering fees where appropriate and the budgets reflected the level of income likely to be received.  As part of the review it was recommended that some external charges were increased by up to 5% from 1 April 2024.  The increases were projected to generate a further £266k which had been included in the overall budget as part of the £1m increased income from sales fees and charges.

Following the review it was proposed to increase income budgets overall by £0.625m. Of this £133k is as a result of updating budgets to reflect current activity and income and the rest is through increased charges

It was noted that the report had also been considered at a recent meeting of the Resources and Governance Scrutiny Committee where the committee had endorsed the budget proposals (Minute RGSC/24/16)

Decision

The Executive approve the budget proposals as detailed in the report.